<<Print>>

While acknowledging the intellectual acumen of the New Patriotic Party (NPP) 2016 running mate, Dr. Mahamudu Bawumia, a member of Government communication and former communications consultant at the Ministry of Finance and Economic Planning (MOFEP), Mr. Abdul Hakim Ahmed, has urged the former deputy Governor of Bank of Ghana (BoG) to be fair with Ghanaians and credit them with some semblance of intelligence when it comes to the issues of the national economy and the way it is managed.

He said, Ghanaians are intelligent than Dr. Bawumia thinks and so there is the need to show some respect to them when he is analyzing the issues of the national economy.

Hakim was speaking to The aL-hAJJ in response to recent claims by the NPP running mate that the National Democratic Congress (NDC) government has mismanaged the national economy despite the huge resources available to the government from several sources since 2009.

“It is palpably clear to even the neutral political observer that Dr. Bawumia is not being fair in his analysis of the national economy.
“All his figures are either deceptive or deliberately distorted for purely political propaganda he often accuses others of indulging. I will be charitable enough to say that he is well aware that the figures are all wrong and yet for political expediency, he is feeding the unsuspecting Ghanaians, especially the partisan supporters of his party.

“For instance, how can you say the NDC government has added $27bn in six years when indeed the total public debt currently stands at about $22bn in September 2014? This includes the $8.1bn that the Mills-Mahama-Amissah Arthur administration has inherited from the Kufuor administration,” Hakim argued.

“Currently, the domestic component of the debts stands at $12.6bn while the external stands at $9.1bn,” adding “the former deputy Governor of the Bank of Ghana and members of his party have been feeding Ghanaians with exaggerated figures and information any time they speak on the national economy.”

Dr. Bawumia, in his recent interaction with an NPP group claimed “the NDC government has borrowed the equivalent of some $27 billion (i.e. the US dollar value of the debt at the time of borrowing) between 2009 and 2014.”

However, Hakim said in calculating the current national debt, there is nothing called the US dollar value of the debt at the time of borrowing,” adding that it is part of the deception from the deputy Governor of the Bank of Ghana.”

“Our total debt from independence to date is just a little below $22bn and the Kufuor administration left behind $8.1bn in December 2008, and that is also part of the $22bn I am talking about. This figure is what our bilateral and multilateral partners including the World Bank and the IMF are working with and not any concocted figures from anybody.

“Don’t forget that the NPP also had $4bn forgiven under the Highly Indebted Poor Country (HIPC) initiative and yet they still left behind $8.1bn debt,” he posited.

Explaining the components of the debt further, the former Ministry of finance communications head, said, apart from the $8.1 bn that the NDC government inherited from the NPP in 2009, the Kufuor-led administration also bequeathed to this government a whopping arrears of GHC 4bn, and clearing the arrears was one of the biggest challenges the government faced in the last six years.

According to him, the reason why the domestic component of the public debt shot up was because when government was faced with this suffocating arrears, it hurriedly went to the domestic market and floated some three year bonds to clear the arrears and provided the badly needed fiscal space for the growth and stability of the national economy.

He pointed out that the NDC inherited some major projects, especially in the road sector which were started by the Kufuor administration without adequate funding and there was the urgent need for the NDC government to arrange for the funding to complete those projects which were at very “infant stages when we took over”.

He cited the gang of six roads which have seen appreciable level of work over the years despite a complete lack of funding plan by the NPP, which projects they over-ambitiously started in 2006.

“Having worked closely with the mangers of the national economy, I am the first person to concede that debt per se is not a problem. What is the problem is how you use the proceeds of the debt to develop the country. Do you use it to pay for salaries and other recurrent or wasteful expenditures as we witnessed in the past or you use them to execute developmental projects that could help expand the economy and recoup the monies back for repayment?” he rhetorically asked.

“Since 2009, this government has been judiciously using its resources to develop infrastructure across all the sectors of the national economy. You can see what we are doing in health, education, energy roads and many other sectors.

“If you can cast your mind wide, you can see a new Police Hospital springing up fast in Accra, a refurbished Tamale hospital, a new teaching hospital at Legon in Accra, the rehabilitated Kumasi airport, the Techiman-Kintampo road, the Buipe- Tamale road, the revived Kumasi shoe factory, the Komenda sugar factory, the gang of six roads that have almost been completed in their entirety and many other projects. So let’s be fair to Ghanaians and just be truthful when we are analyzing the issues of the national economy,” Hakim added.

He pointed out that despite the current economic challenges, the NPP’s eight years of economic record is no were near that of the NDC’s six years.

“We are the government that has grown this economy than any other government in the past. Average economic growth in the past six years stands at some 8.5 per cent compare with the NPP’s average of 5.5 per cent. In fact in the first four years of the NDC administration, average economic growth was a whopping 9.5 percent. You can check the data and see for yourself, so they cannot compare at all,” the former head of communications at the finance ministry who is also an aspiring parliamentary candidate maintained.

He argued that presently, the quantum of the country’s gross international reserve is higher than any time since independence.
“As at November 2014, our Gross International Reserves (GIR) stand at $6.6bn, and this is higher than ever before in history. This reserve position has consolidate our economy as the second strongest in the West African sub-region after Nigeria, whose reserve position stands at some $35bn as a result of their massive oil revenue.

“The NPP bequeathed to us a much weaker reserve position of $2.1bn in December 2008 when they were leaving power, and that could manage a paltry 1.8 months of import cover. Now at about $6.6bn, the international reserve can cover some 3.8 months of imports,” he disclosed.

While dismissing the assertion from the NPP’s running mate that the NDC collected some GHc65bn in tax revenue in the last six years and yet there is nothing to show for it, Hakim said it is a laughable proposition from a season economist and a deputy governor of the bank of Ghana as he was amazed that Dr. Bawumia can make such assertion.

“I don’t know whether he was talking about tax revenue alone or he was talking about domestic revenue which of course would include non-tax revenue or he was talking about total revenue and grant which is much broader…so he needs to clarify his position, so that we can respond appropriately. But whatever it is, this government can show to Ghanaians value for money in all the resources it has collected over the last six years.

We can show productive investments across all the sectors of the national economy, we can show that we have been paying government workers since 2009 without having to use expensive facilities or resort to selling strategic state assets.

“Again, we have also been meeting our debt obligations to all our domestic and international creditors without complaining and we have been constructing roads, hospitals, and schools and paying for subsidies in agriculture and education, timely and frequently. These are what we are doing with all the monies we have collected from our citizens as taxes to keep the country moving just as any responsible government would do. If we have not been doing this, the country would have grind to a halt long ago,” he pointed out.

““For instance, government used about GHc 10bn to pay for compensation of government out of tax revenue of some GHc 15bn in 2013. As a responsible country, government has also been meeting its international obligations by paying its debt timely and this has consolidated the county’s credit worthiness and credibility across the world. Part of the debt we use our taxes to retire is the $750m Eurobond the NPP contracted from international capital market in 2007 with a coupon rate of 8.5 per cent. The evidence of what we use our money for is clear for anybody to see,” Hakim argued.

On oil revenue, Hakim refuted the former deputy governor of the Bank of Ghana’s claims that the nation has raked in some $13.7 bn since commercial oil production started in 2011, saying there was no year that the nation got something beyond $900m. “So how can that add up to $13.7 bn?” He rhetorically added. “He must examine his figures before coming out to deceive Ghanaians.”

“As am talking to you now, Ghana since 2011 has made just about $2.6bn in oil revenue and it beats my imagination why somebody with a pedigree of Dr. Bawumia will insinuate that the nation has made $13.7bn when he knows the truth,” Hakim said, adding “Ghanaians deserve to be respected.”

Giving the breakdown of Ghana’s share of oil revenue since 2011, he said, available data indicate that Ghana made only $444.12 million in 2011, $541.07 million in 2012, $846,767 in 2013, and from January to September 2014, we made $780.07m.”

He pointed out that if Ghana has exported $13.7 bn worth of oil since 2011 when the nation started commercial oil production, it does not mean that the country can claim all the amount as its share, “the country’s share is just a fraction of the amount,” adding that Ghana’s share is just a little below 14 per cent of the total volume of oil exported, and that is less than $3bn since 2011.

He explained that since 2011, government has religiously followed the provisions of the Petroleum Revenue Management Act (PRMA) in the allocation and utilization of the oil revenue, disclosing that “by the dictates of the law, government can only utilize the 70 per cent allocation for the Annual Budget Funding Amount (ABFA) with the remaining 30 per cent going to the Ghana Petroleum Funds (GPF) i.e. the Heritage and the Stabilization Funds,”


Speaking to students of the Tertiary Education Students Confederacy (TESCON) branch of the Tamale Polytechnic recently, Dr. Bawumia alleged that since 2009, the NDC administration had accrued unprecedented resources from taxes, gold, cocoa, loans and oil but all the resources have been wasted.

“In the area of taxation, the NDC government has collected a total of some GH¢ 62 billion in the last six years (2009-2014). In the eight years of the NPP government, the total tax revenue collected was GHC 15.2 billion.

“The NDC government has borrowed the equivalent of some $27 billion (i.e. the US dollar value of the debt at the time of borrowing) between 2009 and 2014. During the eight-year government of the NPP (2001-2008) the government borrowed the equivalent of some $ 5 billion (i.e. the US dollar value of the debt at the time of borrowing),” he said.

He continued: “Ghana's gold exports over the last six years under the NDC government amounted to $25 billion. In the eight years of the NPP government, total gold exports amounted to some $9 billion.

“Ghana's cocoa exports over the last six years under the NDC government amounted to some $14.5 billion. In the eight years of the NPP government, total gold exports amounted to some $7.4 billion. Indeed, cocoa and gold prices were some 50% higher in the period 2009-2014 than the 2001-2008 period.”

Adding the oil factor, he said, “Ghana has also become an oil exporter during the period of the NDC government. Ghana has exported some $13.7 billion of oil in the last four years. There were no oil revenues accruing from oil exports during the 2001-2008 period of NPP governance.”

Dr. Bawumia noted that despite these resources, if the country is broke and cannot afford to fulfill basic statutory demands and payments and had had to seek refuge in the IMF, then it could not be an issue of resources but one of mismanagement and corruption, likening the government to an individual who is blessed with so much resources but ends up broke because of mismanagement.

He also informed the audience that the NDC's recent claims of doing so many projects could not be sustained because the data showed that despite all these resources and the added oil revenue, Ghana was now spending a lesser proportion of its income on capital expenditure infrastructure than it did before the production of oil.